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Ecclestone Makes Second $40 Million Offer To End Corruption Trial

Lawyers for Formula One’s chief executive Bernie Ecclestone today offered to pay $41.4 million to put the brakes on the bribery trial against him in Germany.

It is the second time that the F1 boss has made this offer as Britain’s Independent newspaper revealed in June that he offered the same amount in a bid to prevent him from bring charged. The first offer was declined and discussions about the second one are currently underway.

Prosecutors have accused Mr Ecclestone and his Bambino family trust of paying a $44 million bribe to Gerhard Gribkowsky, the former chief risk officer at German bank BayernLB. They claim that the bribe was paid so that Mr Gribkowsky would steer F1 to Mr Ecclestone’s preferred buyer, the private equity firm CVC, when the race series was sold in 2006. The prosecutors believe that the bribe was funded with a commission which Mr Ecclestone received from BayernLB for helping to put the deal through.

The commission came to 5% of the sale price giving Mr Ecclestone $41.4 million. The prosecutors believe that BayernLB lost out by making the payment as it was used to compensate a bribe.

Mr Ecclestone denies the charges and says he paid Mr Gribkowsky to stop him carrying out insinuations that he would make unfounded allegations about his tax affairs. Mr Ecclestone adds that the $41.4 million payment was entirely legitimate and he revealed to the Daily Telegraph newspaper in October 2012 that it was given in return for him providing a $100 million guarantee that F1 would not collapse.

The trial against Mr Ecclestone began in April and his lawyers said on Tuesday that although the allegations against him are “highly questionable,” and no damage was caused to BayernLB, the 83-year-old wishes to end the case as it has become “extremely burdensome.”

In June he told the Independent “I don’t know why I offered to pay back the commission. Early on we said [we will do it] if that is what is necessary to get this rubbish out of the way. I didn’t say we would pay it back. I said we will pay some back. One of our lawyers spoke to them and they thought 5% was too much and it should have been 2.5%.”

The indictment states that “through the legal document dated 23 July 2012 it was communicated that the defence for the Accused – whilst maintaining its own point of view – had made an offer to BayernLB to pay back the amount received at the time as a commission including interest.”

BayernLB declined the offer and in May 2013 Mr Ecclestone was charged. He did not admit any guilt by making the offer and did not do this to absolve himself but to avoid the hassle of a trial which he now has to attend for several days each week. As the Independent revealed in March, it only takes place on Tuesdays and Wednesdays to allow Mr Ecclestone to run F1 at the same time.

The possibility of a settlement being paid to stop the trial was first revealed by Britain’s Mail on Sunday newspaper in January when court spokeswoman Margarete Noetzel said that “according to German legal procedure, there is the possibility during the trial to stop the proceedings in return for payment of an agreed sum of money to a charitable institution or the treasury, if the accused, the public prosecutors and also the court agrees with it.”

Mr Ecclestone’s latest offer is understood to expire on 8 August and the scheduled hearings tomorrow have been cancelled as the settlement discussions continue. Ms Noetzel said it is not clear when the talks will come to a conclusion but the hearings are due to resume as usual on Tuesday next week.

If Mr Ecclestone is found guilty the penalty could be up to ten years in prison but there is more at stake than his freedom. Following the announcement about the trial he resigned from the board of F1’s parent company Delta Topco although he continues to run the race series on a day to day basis. He insists that he will return to the board once the trial is over but in November CVC co-founder Donald Mackenzie said “if it is proven that Mr Ecclestone has done anything that is criminally wrong, we would fire him.”

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